Source: United States Department of Justice Criminal Division
The Director of Financial Management of the United States African Development Foundation (USADF) was charged today by criminal information and has agreed to plead guilty to accepting gratuities from a USADF contractor and then lying to federal law enforcement officers about those payments.
“Mathieu Zahui is charged with accepting payments from a government contractor and then abusing his position by directing USADF funds to that contractor for little-to-no work,” said Assistant Attorney General A. Tysen Duva of the Justice Department’s Criminal Division. “Corruption by senior officials representing the United States cheats American taxpayers and rigs the system against honest work. This plea agreement demonstrates the Criminal Division’s pursuit of bad actors who engage in waste and abuse in government contracting.”
“The USADF Director of Financial Management’s fraudulent acts betrayed the trust of the American people,” said Acting Assistant Inspector General for Investigations Sean M. Bottary of the U.S. Agency for International Development’s Office of Inspector General (USAID-OIG). “As the Inspector General with continued oversight jurisdiction over U.S.-funded foreign assistance, we will utilize our global investigative reach to aggressively detect and disrupt those who defraud taxpayer dollars programmed overseas.”
According to court documents, Mathieu Zahui, 59, of Fairfax, Virginia, who referred to himself as the “CFO” of USADF, arranged for USADF to pay USADF vendors and contractors through a Kenya-based company, Company-1. Company-1 was owned by a government contractor (CC-1), whom Zahui had known for over 20 years. Between June 2020 and December 2023, Zahui arranged for Company-1 to act as a pass-through for USADF’s payments to certain vendors, rather than have USADF pay the vendors directly. For example, when USADF needed to pay a past-due debt to a staffing vendor, Zahui directed the vendor to invoice Company-1 instead of USADF. Company-1 then invoiced USADF for the vendor’s past-due amount, but added a mark-up of over $20,000 to the amount owed. Zahui approved Company-1’s invoice even though he knew that Company-1 had provided no services related to the vendor’s work.
Zahui approved pass-through invoices for Company-1 that included mark-ups ranging from 17% to 66% above the amounts owed to the vendors, even when Company-1 did no work justifying the mark-up. In total, Company-1 submitted more than 20 pass-through invoices to USADF, for which Zahui caused USADF to pay at least $617,625.49 to Company-1. Of this total amount paid, Company-1 retained $134,886.34 as a mark-up. In connection with this pass-through contracting and invoicing by Company-1, as well as other official acts to benefit Company-1, Zahui accepted $12,000 in cash payments directly from CC-1.
Zahui and CC-1 did not disclose this conduct to the Bureau of the Fiscal Service, which oversaw and authorized USADF’s payments to external parties. With Zahui’s involvement, CC-1 falsely stated on Company-1’s invoices that Company-1 had provided “logistical support” to USADF when, in fact, it had nothing to do with logistical support. For example, in late 2020, USADF owed a membership fee of $50,000 to a professional networking organization serving the African diaspora. Instead of having USADF pay its membership fee directly, Zahui directed CC-1 to have Company-1 submit an invoice to USADF that included the membership fee so that Company-1 could act as a pass-through for the $50,000 payment to that organization. The invoice submitted claimed that Company-1 provided “logistical assistance support for ADF” and included a mark-up of $9,900.08.
When interviewed by federal law enforcement agents in 2024, Zahui was asked about his relationship with CC-1 and falsely stated that he had never received any benefits from CC-1 when, in fact, he had received $12,000 in cash payments from CC-1.
Zahui agreed to plead guilty to one count of accepting gratuities from CC-1 and one count of making a false statement to a federal law enforcement officer. He faces a maximum penalty of two years in prison for the gratuities charge and five years in prison for the false statement charge. His plea hearing will be scheduled by a federal district court judge. The judge will thereafter determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
USAID-OIG is investigating the case.
Assistant Chief Kyle Hankey of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Sungtae Kang for the District of Columbia are prosecuting the case.